HBL Microfinance Bank and IFC Sign US$ 80 Million Risk Sharing Agreement

Karachi: HBL Microfinance Bank (HBL MfB) has signed a US$ 80 million Risk Sharing Agreement (RSA or the facility) with the International Finance Corporation (IFC), a member of the World Bank Group. HBL MfB will be able to share 50% of the risk on microfinance loan collateral of up to US$ 80 million (in PKR equivalent) with IFC on an unfunded basis under this facility, which is backed by the Global Agriculture and Food Security Program’s Private Sector Window (GAFSP).

The partnership between HBL MfB and IFC will substantially improve the availability of financing for microenterprises and smallholder producers throughout the nation, with a particular emphasis on women entrepreneurs. The agreement was signed in Karachi in the presence of the senior leadership of HBL MfB and IFC, including Maya Inayat Ismail, Chairperson of HBL MfB; Amir Khan, President and CEO of HBL MfB; and Makhtar Diop, Managing Director of IFC.

HBL Microfinance Bank has played a significant role in the microfinance sector in Pakistan, contributing to the advancement of financial inclusion. This RSA represents a significant development, highlighting the Bank’s ongoing commitment to innovation and leadership in meeting the changing financial needs of underserved communities. HBL MfB has established an agreement on a significant scale, which may influence industry standards and contribute to the role of microfinance in empowerment and economic growth.

This agreement also underscores the Bank’s resilience in navigating the challenges of the microfinance sector. Amidst an evolving economic landscape, HBL MfB remains committed to developing forward-thinking solutions that enhance financial accessibility while mitigating risks. The RSA exemplifies this approach — leveraging strategic partnerships to strengthen financial resilience, expand lending capabilities, and maintain sustainable growth.

Amir Khan, President & CEO, HBL Microfinance Bank, while sharing his views on the RSA, said, “This partnership with IFC is a testament to our commitment to financial inclusion. The facility serves as a replicable model for strategic partnerships that mitigate market challenges while driving sustainable development. By pioneering this Risk Sharing Facility in the microfinance sector, we are ensuring that underserved segments of the society — especially small business owners and farmers, particularly women, have access to the capital they need to thrive. We are thankful to IFC for their trust in us and look forward to the growth and progress it will bring for underserved Pakistanis”.

Momina Aijazuddin, Regional Head of Financial Institutions Group (FIG) at IFC, said: “Boosting access to finance, especially for smallholder farmers, small businesses, and women, can be a gamechanger in Pakistan. With this in mind, IFC is excited to support this pioneering risk sharing facility which aims to de-risk HBL MfB’s on-lending activity to its microfinance clients and support critical growth opportunities in agriculture, entrepreneurship, and women’s empowerment.”

This agreement will accelerate financial inclusion, and further HBL Microfinance Bank’s mission of creating a more inclusive and resilient financial ecosystem in Pakistan.